Is vehicle production returning in Latin America?
Hit with the double-edged sword of the Coronavirus pandemic and the semiconductor supply crisis, the big question around the world in terms of the vehicle industry in 2021 is when will production be getting back on track.
In Latin America, while automobile production is yet to make any type of significant comeback, the manufacturing of light commercial vehicles (LCV) is already up from pre-pandemic (2019) levels.
In Brazil, 462,405 cars were produced in the first quarter of 2021, down 6.1% year-over-year. When compared to pre-pandemic figures, this year's result is 21% less than the 587,115 units produced in 1Q19, according to data from the international organization of vehicle manufacturers, OICA.
In Mexico, 216,483 cars were produced in the same period, down 37% compared to 1Q20. Reflecting two years back, production was 46% less than the 401,626 posted in 1Q19.
In Argentina, 31,734 cars were produced in Q1, up 33% compared to last year and the only country in the region reporting automobile production higher than pre-pandemic levels. When compared to the 30,722 units produced in 1Q19, this year's result is still 3.3% higher.
Meanwhile, 13,398 cars were produced in Colombia from January to March 2021, down 10% year-over-year. The result was 26% less than the 18,978 units produced in 1Q19.
In Brazil, 97,110 LCVs were produced during the first quarter of this year, up 54% from 1Q20. Meanwhile, this year's result is up 22% from the 79,855 units produced during the first three months of 2019.
In Mexico, 604,641 LCVs were produced in 1Q21, up 2.4% year-over-year. Compared to 1Q19, the result is still 1.8% up from the 593,710 units produced from January-March of that year.
Meanwhile, 57,543 LCVs were produced in Argentina during the first three months of this year, up 37% from 1Q20. In comparison to the same period in 2019, the result is still 25% more than the 45,970 units produced in January-March of that year. No LCVs are produced in Colombia.
2021 Fiat Strada, best-selling LCV in Brazil - Latam's largest vehicle market - last year. (source: Fiat)
Second Quarter 2021, and beyond
Keep in mind that these numbers are from the first quarter of 2021. Although the lack of semiconductors could even last throughout 2022, the Coronavirus pandemic is slowly coming under control and new car sales are on the rise so automobile production could turn around shortly.
Considering the region's two largest markets, Brazil and Mexico, new automobile sales during the first seven months of 2021 was collectively up nearly 23% so stock refills are likely around the corner. In Brazil, sales rose 26% to 1.17 million units and in Mexico, the uptick was 17% to 597,557 units.
Automobile sales performances in the two countries, however, are yet to recover to pre-pandemic (2019) levels.
For more insight on Latin America, join Fleet LatAm in two upcoming events this month, one being the Business Networking Group meeting taking place on 14 September and the other being the Fleet LatAm Conference occurring on 21 September.